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Unformatted text preview: Chapter 1: Intro to Int. Business 17:11 Economic Interdependence Experts realize that no business is purely domestic and even the smallest local firms are affected by global competition and world events Disruption anywhere in the supply chain of todays globally connected manufacturing plants brings distant assembly lines to a halt Global economic interdependence is most obvious in the spread of infectious disease- impact can now ripple through the worlds economy within days World today is more economically interdependent than at any other time in history; this has led to the globalization of product, service, and capital markets Factors of economic interdependence: natural resources, technological advances, in travel, shipping and communications, and internet Can also be attributed to sharing of technology and know how with patents, copyrights, and trademarks now licensed for use around the globe as freely as goods and services are sold Interrelatedness of financial markets, worldwide flow of capital, and coordination of economic policies between nations have had a tremendous impact on the global economy Nations realize the need to reach agreement on important legal issues led to the development of widely accepted legal norms and conventions to provide a stable and consistent legal environment for firms doing business across national borders Factors that hold the greatest promise for change growth of democracy, resurgence of market-oriented economies, decline of som Greatest challenges entrenched poverty and ignorance, declining natural resources, environmental degradation, and risk of widespread infectious disease America in International Markets US firms have built factories around the globe and shared their technology, know-how, and management capabilities with their foreign partners Historically American involvement came chiefly from its largest companies At end of WWII the US was in a preeminent political and economic position relative to the war devastated nations of Europe and the far East US recognized its responsibility to pull world out of ravages of war Succeeded through the creation of a massive industrial economy based on consumer goods that stimulated and strengthened the redevelopment of once industrial Europe and Japan US also recognized need for international institutions such as the United Nations (UN), the International Monetary Fund (IMF), the World Bank (WB), and the global trading organization () to ensure that the world did not slip back into recession In 1980s, when the effect of mounting US trade deficits began to be felt, when foreign...
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- Spring '11